We're checking in with Free Range Foods again, the company that makes shelf stable meals packs because they've started to plan for the future. Their question is can the company afford to purchase $20,000 of new equipment with cash in three months time and will the company be profitable over that same period?

To help answer that question, the company has put together the following estimates and data:

For the next four months, the company estimates sales volume at 60,000, 58,000, 70,000 and 72,000 units at a price of $3.50 per unit.

The company has 4,200 units in inventory right now and wants to maintain ending inventory at 10% of next month's sales. Production costs are expected to be $2.62 per unit which must be paid in the month of production.

Its monthly administrative expenses include advertising of $12,750, payroll of $25,000 and rent of $15,000 which also must be paid monthly.

The company has $12,000 cash right now.

Required:

A. Can the company afford to purchase $20,000 of new equipment with cash in three months time?

B. Will the company be profitable over that same period?

We're checking in with Free Range Foods again, the company that makes shelf stable meals packs because they've started to plan for the future. Their question is can the company afford to purchase $20,000 of new equipment with cash in three months time and will the company be profitable over that same period? To help answer that question, the company has put together the following estimates and data: - For the next four months, the company estimates sales volume at 60,000,58,000,70,000 and 72,000 units at a price of $3.50 per unit. - The company has 4,200 units in inventory right now and wants to maintain ending inventory at 10% of next month's sales, Production costs are expected to be $2.62 per unit which must be paid in the month of production. - Its monthly administrative expenses include advertising of $12,750, paryroll of $25,000 and rent of $15,000 which also must be paid monthly. - The company has $12,000 cash right now. Bequired: A. Can the company afford to purchase $20,000 of new equipment with cash in three months time? B. Will the company be profitable over that same period